Executive Summary: Key Legal and Evidentiary Issues

• Dispute centered on alleged bad faith eviction under Section 10AA of the Residential Tenancies Act following the sale of a rental unit.

• Appellants claimed respondents misrepresented their intent to occupy the unit, citing increased rent and non-use by the named occupant.

• The adjudicator found no landlord-tenant relationship existed between the parties after the Agreement of Purchase and Sale was signed.

• Statutory Declaration language using "we" was deemed non-fatal despite lacking specificity about the intended occupant.

• Court upheld that no duty of care or contractual obligation existed between the purchasers and the existing tenants.

• Appeal dismissed due to lack of error in law, with the adjudicator’s fact findings supported by sufficient evidence.

Facts of the case

Dale Rissesco and Anileda Tudisco were tenants at a property in Dartmouth, Nova Scotia, known as 34 Bethany Way. In early 2022, their landlords sold the property to the respondents, Mohd Mustafizur Rahman and Yuyin Jia. As part of the sale, the respondents provided a statutory declaration under Section 10AA of the Residential Tenancies Act (RTA), stating their intention, in good faith, for a family member to occupy the unit.

The tenants were served a Form DR2 (Notice to Quit), and shortly after, they bought a duplex in Bridgewater and vacated the premises. Later, they discovered that someone other than the respondents’ family was living in the unit and alleged that the eviction was in bad faith, motivated by a desire to charge higher rent.

Small Claims Court hearing

The case was initially heard in Small Claims Court, where Adjudicator Darrel Pink dismissed the tenants' claim. He found that the respondents acted in good faith and that the statutory declaration was not false. The unit remained vacant for months after closing because Ms. Jia’s mother—whom the respondents intended to have occupy the unit—had to return to China and was delayed in obtaining a new visa due to COVID-19-related slowdowns. Adjudicator Pink accepted the respondents’ explanation and found no misrepresentation or legal obligation to the tenants.

He also concluded that no landlord-tenant relationship existed between the appellants and respondents, as there was no lease, no exchange of rent, and the appellants vacated before the property closed. Furthermore, he held that even if a duty of care existed, the damages claimed by the appellants were not reasonably foreseeable or compensable under law.

Appeal to Supreme Court of Nova Scotia

On appeal, the appellants argued that a landlord-tenant relationship had formed upon signing the Agreement of Purchase and Sale, and that they were evicted in bad faith. They claimed the respondents’ use of the word “we” in the statutory declaration was misleading, as it suggested they would personally occupy the unit.

Justice Glen G. McDougall of the Supreme Court of Nova Scotia dismissed the appeal. He agreed with the adjudicator’s conclusion that no legal relationship existed between the parties, emphasizing that the sellers remained the appellants’ landlords until the transaction closed. The court found the appellants’ new evidence inadmissible, applying the R. v. Palmer test, and reiterated that appeals from Small Claims Court must be based strictly on legal errors, not factual disagreements.

Justice McDougall also found no error in law regarding the interpretation of the statutory declaration or the Civil Procedure Rules related to language and comprehension, noting that the adjudicator properly evaluated the respondents’ understanding of the affidavit’s contents.

Outcome

The court upheld the Small Claims Court decision, confirming that the eviction was not conducted in bad faith and that no landlord-tenant relationship or legal obligation existed between the appellants and the respondents. The appeal was dismissed, with costs awarded to the respondents.